Apple's liquid-crystal screen pusher mulls $2bn IPO – report Tokyo-based Apple supplier Japan Display is reportedly considering an initial public offering which could raise up to $2bn. The firm makes screens for the iPhone 5C as well as the 5S. It was created by a government-backed fund which integrated screen-making businesses spun off from Japanese firms Sony, Toshiba and Hitachi …
Apple will help with financing of new/additional production line capacity for their suppliers (I presume in exchange for guaranteed capacity), but they don't seem interested in buying manufacturers per se. Samsung have to be careful in buying other companies in this field or they may find themselves in a monopoly position, and will have all sorts of restrictions dropped on them if they do.
>Apple will help with financing of new/additional production line capacity for their suppliers
According to their CEO - in the press release to Reuters - it was the Apple contract which nearly sunk them [much higher volumes had been assumed] - he also said they were only able to recover from a 1% margin by getting other (non-Apple) work.
Not sure why everyone assumes it's such a Golden Chalice - many, if not most, of Apple OEMs have struggled rather than profited.
The 1% OPERATING margin (i.e. after costs are subtracted) they were talking about was due to a cut in orders from Apple. It's the same in any business, if you have a large customer who cuts their orders then you're going to see a cut in profits. It doesn't matter WHO that customer is.
A margin of only 1% is still a profit, not being "nearly sunk". Foxconn run almost permanently on not much more. What we don't know is why Apple reduced orders as their sales numbers weren't as bad as the pundits were predicting and they also source from 2 other display manufacturers (AU Optronics and Samsung). It's possible they were struggling to reach quality standards or volume.
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